Weetabix is also the owner of Alpen, having invented the muesli in 1971 after its marketing director stayed with a French family who had pioneered a do-it-yourself version. Weetabix proceeded to perfect the blend in a concrete mixer and Alpen now accounts for 3% of the cereal eaten in Britain and Ireland.

The Weetabix brand, though, is the market leader, having steadily overhauled the American-owned Kellogg's cornflakes over the last 20 years to claim top spot three years ago with a 7% share. Though derided by some - the Savoy's former head chef last year said they "look like cakes that you give to dogs" - Weetabix appears to have a special place in British stomachs.

Sir Richard George, the company's chairman, said: "Mothers tend to wean their children on Weetabix and people in Britain tend to grow up with an in-built liking for them. That's not the case in other countries - it's very hard to sell them in Germany for instance."

It is also appears to be a cereal that appeals to the British eccentric. Jack Russell, the idiosyncratic former England wicketkeeper, used to insist that his Weetabix were soaked in milk for precisely 12 minutes. The Brits are also the world's biggest per capita consumer of cereal, eating around 6.5kg a year each - that is the equivalent of 336 Weetabix biscuits.

Yesterday's deal will crystallise the fortune of Sir Richard and the George family. He will receive almost £45m in cash from the sale and other members of the family will share £83.5m. About half of Weetabix's 2,800 staff also own shares.

Sir Richard said the decision to sell the business, which also includes Ready Brek and Weetos, was driven by the need to expand into other areas of the grocery trade.

"I could see all my products by walking down one aisle in the supermarket," he said. "What we wanted to do was go outside one aisle and go into other products.

"At around the same time we were approached by Hicks Muse and we could see that they shared the same vision. The idea is that we are trying to build a bigger, stronger grocery group.

Lydon Lea, a partner in Hicks Muse, promised to "respect the heritage" of all the British brands now in the firm's ownership within its Premier Foods division. The venture capital firm is likely to sell off Premier via a stock exchange flotation within a couple of years. It started its acquisition spree with the purchase of Hillsdown Holdings in 1999.

Increased size should make Weetabix and Premier better placed to resist pricing pressure from the major supermarkets and the constant attacks from manufacturers of own-label products.

The Weetabix brand has already demonstrated its ability to resist copy-cat brands - only 20% of its market has been ceded to lookalike products. The company as a whole, though, has been forced to accept the own-label invasion and is now Britain's second-largest manufacturer of own-label cereals.

Overall, Weetabix made pre-tax profits of £44.4m on sales of £362m in the year to August 2002, the last set of published figures. That represents a fall from the £50m-plus it used to make in the late 1990s, but its relative prosperity has been a surprise in a competitive industry dominated by global giants such as Nestle, Nabisco and Kellogg's.

Although regarded as a traditional British company, the cereal itself was invented in Australia in the early 20th century, at around the same time that WK Kellogg was experimenting with wheat cereals in America.

Sir Richard's grandfather, Frank George, established the company in Britain in 1932, but does not have the rights to the product in Australia, New Zealand and South Africa. In those countries, it is owned by a separate company - Weetbix, spelled without an "a". The wheat was originally also imported from Australia but prices movements in the 1970s forced the company to switch to local suppliers. "We changed from Australian to English wheat 25 years ago, but apart from that I can't think of any other changes to the product," said Sir Richard.

Frank George worked as chairman until his death at the age of 83 in 1970, and Weetabix's headquarters have steadily grown over the years to dominate the small town of Burton Latimer, near Kettering, in Northamptonshire. Roughly half the 2,800 workforce is based there.

Sir Richard plans to continue as chairman under Hicks Muse but conceded that his staff - many of whom have spent all their working lives at the firm - will have to be prepared for change, even though no redundancies are expected as a result of yesterday's sale.

"The culture of family businesses tends to be a little softer than those of financial companies," said Sir Richard. "I think there will be a cultural shock but I don't think it will take us long to fit in with the new culture."